ANA turned tables at last minute by making Airbus a deal

TOKYO -- With a late-stage offer to buy aircraft from a key creditor, ANA Holdings defied predictions that U.S.-based Delta Air Lines would emerge as the aviation industry partner in Skymark Airlines' flight out of bankruptcy protection.

"I'd been on edge to see how things would turn out today," ANA Director Toyoyuki Nagamine told reporters Wednesday. "Frankly, I couldn't be more relieved."

Nagamine's words hint at the drama that occurred behind the scenes.

The Delta-backed funding plan put forward by Intrepid Aviation was seen as having the best chance to garner majority support from creditors in Wednesday's vote, given the U.S. leasing company's roughly 38% share of the voting rights. The ANA-sponsored plan would have lost if even one of Skymark's other leading creditors -- Airbus, Rolls-Royce and CIT -- had voted against it.

All of these big stakeholders do considerable business with Delta. Apart from them, the rest of those holding claims against Skymark totaled only about 4% of voting rights. Many observers predicted Intrepid's proposal would win by a wide margin.

The odds began to move in ANA's favor late last month when the company made a promise to Airbus of future aircraft orders, carefully couched so as not to trigger a disclosure requirement, people familiar with the matter said.

It is unclear how many or what model ANA pledged to buy. But a likely choice is the A380 superjumbo jet, which Skymark had planned to fly on international routes before its finances took a turn for the worse. With a catalog price of roughly $430 million, the A380 ranks as Airbus' top-of-the-line model, though it has proven unpopular among international carriers. Airbus has been pitching the double-decker, wide-body jet aggressively.

When a midnight deadline passed without a competing offer of aircraft purchases from Delta, Airbus made its decision. It informed ANA early Wednesday morning that it would vote in favor of the turnaround plan backed by the Japanese carrier. Rolls-Royce and CIT, which had gone along with Airbus so far in Skymark bankruptcy proceedings, followed its lead to the end.

ANA had maintained it would make no new aircraft orders to secure a place among Skymark's sponsors. But at a news conference Wednesday, Nagamine left that possibility open.

For ANA, adding the A380 to its fleet would run counter to its shift toward fuel-efficient midsize jetliners. The company also could wind up with a capacity mismatch that results in higher fares. But "it was so reluctant to let another airline get Skymark's landing slots at Haneda Airport that it was willing to take those risks," a person familiar with ANA's strategy said. Access to the Tokyo-area hub is seen as a cash cow.

"We've seen how the Skymark turnaround ends, but the real test for ANA is yet to come," an aviation industry insider says.